Expecting

With many within the industry expecting only 40 Bcf or so to be removed from natural gas storage for the week ending Dec. 4, Thursday morning’s news from the Energy Information Administration (EIA) that 64 Bcf was withdrawn was supportive enough for the bulls to launch the January futures contract back above $5 to a new high in the larger uptrend.

November natural gas futures managed to carve out a modest gain Wednesday as traders were expecting a bounce from Tuesday’s losses and brokers were locking in Rocky Mountain basis and buying protective put options.

July natural gas futures fell hard after the release of inventory data more bearish than traders were expecting. The Energy Information Administration (EIA) reported that for the week ended June 12 natural gas inventories increased by 114 Bcf, well ahead of market expectations in the 105 Bcf range.

Traders were apparently expecting a larger natural gas storage build last week than the 21 Bcf addition reported Thursday morning by the Energy Information Administration (EIA) because May natural gas futures knee-jerked higher following the 10:30 a.m. EDT report. However, the contract ended the day on a lower note, closing out the regular session at $3.599, down 9.4 cents from Wednesday’s close.

Traders expecting fireworks on the expiration of February natural gas futures were sorely disappointed Wednesday as the contract failed at an early push to higher prices and ended up going off the board at $4.476, down 2.7 cents. Before taking over as the new front-month contract, March natural gas on Wednesday dropped 2.5 cents to close at $4.420.

Despite most industry expectations looking for a natural gas storage withdrawal between 135 Bcf and 145 Bcf, it appeared that some traders were expecting an even larger number as the 147 Bcf pull for the week ended Dec. 19 pushed near-month natural gas futures values temporarily lower before they rallied Wednesday afternoon. In the shortened trading session, the January contract went on to close at $5.910, up 17.3 cents from Tuesday’s finish.

Even though the traditional natural gas storage injection season ended with last week’s report, traders and analysts, while expecting another injection to be reported by the Energy Information Administration (EIA) for the week ended Nov. 7, were not anticipating the whopping 62 Bcf that was injected into underground storage. As a result, near-month futures on Friday tested support at $6 before rebounding to nearly unchanged from Thursday’s close.

Expecting a final state of Washington regulatory merger approval to take its utility operations private before year-end, Bellevue, WA-based Puget Energy reported a financial bump last Wednesday, announcing a third quarter net loss of $8.2 million, or minus 6 cents/diluted share, compared to net income of $11.4 million, or 10 cents/share, for the same period last year. Due to its pending $7.4 billion merger with a consortium of private investors, Puget senior executives did not hold a conference call with financial analysts.

Expecting a final state of Washington regulatory merger approval to take its utility operations private before year-end, Bellevue, WA-based Puget Energy reported a financial bump Wednesday, announcing a third quarter net loss of $8.2 million, or 6 cents/diluted share, compared to net income of $11.4 million, or 10 cents/share, for the same period last year. Due to its pending $7.4 billion merger with a consortium of private investors, Puget senior executives did not hold a conference call with financial analysts.